John Grogan: Does my hon. Friend agree that it is important that credit unions are not just an urban phenomenon, but that they also offer savings and loan opportunities in rural areas? Will he commend the work of North Yorkshire county council, which on 4 December will consider a business plan drawn up in association with local housing associations to expand the common bond of the York Credit Union to the whole of North Yorkshire so that credit union facilities will be available in the whole of the county of Yorkshire?

Roberta Blackman-Woods: I thank my hon. Friend for that response. She may be aware of the situation of Beth Porteous, one of my constituents, who is a post-graduate student at Durham university and is expecting a baby. She gets paid quarterly by the university for research work that she undertakes, but she has been told that she does not qualify for statutory maternity pay or maternity allowance and that she must take unpaid leave and return to work eight weeks after the baby is born. I would be grateful if my hon. Friend would undertake to look at cases such as Beth's to see what additional support can be given to women who find themselves in that unfortunate situation.

Chris Grayling: In fact, the first time we heard about that was in a press release from his Department in January 2006.
	Will the Secretary of State confirm that today's announcement involves 20,000 fewer people claming incapacity benefit? Will he confirm that that represents less than 1 per cent. of the total of 2.6 million currently claiming the benefit? Unless he manages to increase his current rate of progress, he is set to be 25 years late in hitting his target of getting 1 million people off incapacity benefit.

Alistair Darling: With your permission, Mr. Speaker, I should like to make a statement to update the House on the current position with regard to Northern Rock. The House will recall that last week I said during the Queen's Speech debate that I would keep the House informed of developments. I also said that I expected to publish a statement of principles underpinning the Government's approach to proposals received by Northern Rock with regard to its future. I published that statement this morning, prior to the markets opening, in the usual way. Copies are available in the Vote Office and the Library of the House.
	It is important to be clear about the respective responsibilities of the Northern Rock board and the Government. The board is legally responsible to its shareholders for the future of the company. However, the Government have a wider public interest in maintaining financial stability, which is why we agreed to lender-of-last-resort support in September and subsequent lending by the Bank of England. The Government also have an interest in protecting the interest of the taxpayer. Because of this, the Government have, as a major creditor, a direct interest in the future of Northern Rock. The Government therefore have to agree to any proposals for the future of Northern Rock.
	Before turning to our approach, let me deal first with the position on the guarantee arrangements to Northern Rock depositors provided by the Government and, secondly, with the loan facilities provided by the Bank of England to support Northern Rock and to maintain financial stability in general. First, we have made it clear that the guarantee arrangements already announced for depositors in order to safeguard their position will remain in place during the current instability in the financial markets. These guarantee arrangements were absolutely necessary. They have not had any cost to the taxpayer because these deposits covered by the guarantee arrangements remain in the bank. As I have said before, savers are free to take their money out if that is what they want to do, but they have no need to do so. The guarantee arrangements ensure that savers' deposits are safe. The guarantee will not be removed without proper notice being given to depositors.
	Looking ahead, I have made clear that the Government will legislate for a new regime for protecting bank depositors. As the House knows, we have published a discussion paper on this legislation, and I very much welcome the offer of cross-party support for it. But it is important that we get it right. There are many examples, both here and in other countries, of legislation having been rushed through only to be regretted later. The current consultation finishes on 5 December. I will bring forward proposals in the new year when I have also had time to consider the outcome of the Treasury Committee's work, as it has requested.
	The second element of support is the Bank of England loan facilities. It is important to remind ourselves of why this support was provided in the first place. Northern Rock got into difficulties because it was almost totally reliant on getting very substantial sums from the securitisation and money markets on a continuous basis to do its business. When that lending became ever more difficult, it had no option other than to go to the Bank of England. Because of the possible impact on the stability of the wider financial system, it was right that I authorised the Bank of England to intervene. That, too, had cross-party support.
	While international financial markets have shown signs of improvement since the sharp credit squeeze in August and September, following the problems that arose in the American housing market in the summer, there clearly remains continued uncertainty in the markets. The rates at which banks are willing to lend to each other also remain high in all the major currencies. It is therefore vital that we do everything we can to maintain stability internationally, as well as here at home. As the House knows, we are taking steps at an international and domestic level to improve the regulatory regime and to provide greater transparency. That was the subject of the discussions of G20 Finance Ministers that I attended in Cape Town over the weekend.
	The continuing support of the Bank of England has also given Northern Rock an opportunity to consider its strategic options. I am very clear that this is also the right thing to do and, indeed, when I announced this, it enjoyed support from both sides of the House. I know that there has been interest in how much support the Bank of England is giving. The Bank publishes its balance sheet every week. However, in common with other central banks, it does not provide details of any operations because it believes that doing so would undermine its ability to provide such support. I understand the frustrations that that can sometimes cause, but to provide what would, in effect, be a running commentary on any operations would be likely to have adverse affects that none of us would want.
	Having said that, I can tell the House that Bank of England lending is secured against assets held by Northern Rock, which include high-quality mortgages with a significant protection margin built in and high-quality securities with the highest quality of credit rating. The Bank is the senior secured creditor. The Financial Services Authority has said before, and continues to say, that Northern Rock's main asset base—its mortgage book—is strong and sound.
	As with any lender on this scale, we have ensured that the Bank's lending is subject to significant conditions and controls to ensure that our interests are protected, and, in return for that facility, Northern Rock has agreed a number of controls, including not declaring, making or paying any dividend without the prior written consent of the Bank of England, and not making any substantial change to the nature of its business.
	I now turn to the next stage. It is in the interests of everyone that the situation with regard to Northern Rock is resolved as soon as possible. That was why Northern Rock asked for expressions of interest in purchasing the business. As the company announced earlier today, as part of its review of its strategic options, it has received indicative expressions of interest, covering a range of options for the business. It currently expects to receive further expressions of interest in the next few days.
	It is essential that the public interest is protected. That is why I have published today the principles that will underpin the Government's approach, when assessing proposals from Northern Rock regarding its future. As I have already said, the Government have to agree to any such proposals. The principles make it clear that the Government have a clear duty to protect the public interest, and we will do so. However, I think that the whole House, and particularly Members representing the north-east, will want us to do everything we can within the constraints on us to resolve a very difficult position for Northern Rock.
	Let me therefore set out our approach. First, we must protect the interests of the taxpayer. Substantial sums have been lent, and that money has to be repaid at an appropriate time and rate. The Government will consider proposals with a view to reaching the best outcome for the public purse. Secondly, we want to protect depositors. It is essential to do everything we can both to safeguard their interests and to maintain the service provided to them. Thirdly, we will maintain wider financial stability.
	As I have made clear all along, the Government will now assess proposals from the company consistent with the approach that I have set out, and we remain closely engaged with the company as the best outcome for its future is assessed. As the company has acknowledged today, any proposals would have to be approved by the Government and, importantly, any proposal can be vetoed by the Government. In that way, the Government can ensure that the public interest is safeguarded. As I have told the House on previous occasions, any outcome must meet EU state aid rules.
	It would be quite wrong to dismiss any option now without proper consideration, as some have suggested we do. I continue to believe that it is right to use this time to explore the best outcome for the company and the public interest. I agreed to Bank of England support because I believed it was right to do so. I agreed to continue support to allow Northern Rock the time it needs to consider its strategic options because it was right to do so.
	I have set out today the approach that the Government will take as they assess proposals from the company to ensure that we will approve a solution only if it safeguards both the public interest and the specific interests of the taxpayer. That work is being done now and will be concluded as quickly as possible. I will, of course, continue to keep the House informed in the coming weeks. I commend this statement to the House.

George Osborne: The question we now ask of the Chancellor is simple: has he been honest with taxpayers about the risks that they face, and has he told the whole truth? First, let us look at what he has announced today. He announced that what was supposed to be a short-term emergency facility for Northern Rock may now be extended beyond February and could last for years. Thank you, but we already knew that because it was in a memo from the company's advisers that was leaked last week. Indeed, throughout the crisis we have learned more from media leaks than we have from the Government.
	The Chancellor will not tell us the size of the facility, when he expects it to be repaid or the terms of the repayment, even though much of that information is an open secret in the City. Indeed, the Governor of the Bank of England wants to publish the letter that he sent to the Chancellor to set out those terms. He told the Select Committee that that he wanted to do so, but the Chancellor refuses to publish the letter and simply says that it is in the public interest that he should refuse. Clearly, the Governor of the Bank of England disagrees. Will the Chancellor explain in greater detail why he will not publish that letter?
	This is not about the commercial interests that the Prime Minister spoke about last week, but about the public interest and the £900 that has been pledged on behalf of every taxpayer in Britain. The Chancellor talks about the Government's liabilities being secured against £100 billion of Northern Rock assets, but he does not say that many of the assets are already promised to other creditors. Will he confirm that the free assets at Northern Rock could be closer to £40 billion and that total Government liabilities, through both the facility and the deposit guarantee, might now be approaching the total of the available assets, putting the taxpayer further at risk?
	The Treasury also said today:
	"Authorities expect the costs and risks associated with Northern Rock to be borne to the greatest extent possible by the current and future private sector providers of capital."
	So do we, but has the Chancellor given a general guarantee to cover the £13 billion or so lent by medium-term note holders—the large institutions that lent money with their eyes open? Has the Chancellor considered reducing the risk to taxpayers by announcing a cap on the guarantee offered by the Government so that only individual savers are fully protected? Of course, we need to get the depositor protection legislation right, but we now know from the Governor of the Bank of England that he has been pressing the Chancellor to do that for a considerable time.
	The Chancellor has failed to address today the two things that he appears so far to have kept secret from Parliament and from the taxpayer. First, will he tell us whether it is true that the Treasury, as well as the Bank of England, has lent money to Northern Rock? He mentioned only the Bank of England in his statement, but today we are told that the Treasury has also lent so-called subordinated term debt, which does not have to be paid for five years, comes at the back of the queue and is in most danger of default if the bank is wound up. If that is true, taxpayers have been exposed to an extraordinary long-term risk, yet we have been told about that Treasury loan by the BBC's business editor rather than the Chancellor of the Exchequer. If it is true, the Chancellor is surely deliberately withholding information from Parliament and the public. Will he confirm the existence of that Treasury loan?
	The second thing that has become clearer today is that the Chancellor cannot be sure of keeping the promises that he and the Prime Minister made to the taxpayer. He said to the Select Committee that
	"we fully expect to be able to get that money back."
	He said to the public that
	"any money that the Government makes available"
	to Northern Rock
	"we can recover from its assets".
	The Prime Minister said at the Dispatch Box last week that the money from the taxpayer was
	"guaranteed against Northern Rock assets."—[ Official Report, 14 November 2007; Vol. 467, c. 660.]
	Today, the Chancellor merely says that he wants the best outcome for the public purse. Will all the money lent by the taxpayer be repaid with interest—yes or no? Let us hope that the answer is yes and that, in the final reckoning, the taxpayer will not have paid a heavy price for the Government's incompetence. Let us hope that the Chancellor can be honest today about the risks to the taxpayer and about the existence of the secret Treasury loan.
	We are considering a tale of incompetence and weak leadership from a Government who now reel from one disaster to another. We have a Chancellor who appears to have made secret loans from the Treasury, who has made guarantees to the taxpayer that he cannot be sure of honouring and whose weakness contributes to the instability of the financial system. That is why the Chancellor's job is now on the line.

Alistair Darling: It would be regrettable if the future of Northern Rock became a political football, and I know that my right hon. Friend—who of course represents a seat in the north-east—is very mindful of the effect on the economy of the north-east. I agree that the three principles set out this morning are important. As for the guarantee, perhaps I did not deal with the point raised by the hon. Member for Tatton (Mr. Osborne). Having given the guarantee, I am now invited by him to unpick it—but that would be the wrong thing to do.

Brian Binley: The Chancellor charges the shadow Chancellor with irresponsibility, but many taxpayers believe that that the Chancellor may have acted irresponsibly by putting their money at risk. They will not be reassured by the vague assurances that he has given today, unless he is more specific. For that reason, can he tell us the precise value of the free collateral that Northern Rock holds, and how many of its assets are already pledged to other creditors?

Andy Burnham: I hope that the hon. Gentleman will keep his seat, because I am going to read out one of his own quotations later—a treat that we can all look forward to. The statement issued by the Court of Auditors last week showed some progress, but it was disappointing, and there needs to be further progress. Let me refer him to a report by the House of Lords on this issue, which states that
	"the failure to give a positive Statement of Assurance does not tell the whole story... Firstly, we argue that a lack of a positive Statement of Assurance does not necessarily indicate that high levels of fraudulent or corrupt transactions have taken place."
	 [ Interruption. ] I simply refer the hon. Gentleman to that learned document on the European accounts, which he should consider before he indulges in his sweeping and ill-informed generalisations about what those accounts mean.

Andy Burnham: A visit to an optician's in Stone might be in order, too.
	This Government will continue to make the positive case for an enlarged and prosperous European Union as being directly in our national and economic interest. Britain benefits from being part of an open, prosperous Europe of 500 million people. The EU is Britain's largest market by far, and—I hope that Conservative Members will listen to this point—it follows that British business needs a Government who engage constructively in discussions about the operation and rules of that market. It is precisely because we engage constructively, rather than grandstanding and posturing, that we secure results that are in the national interest.
	To aid our debate today, let me put some facts on the table. First, the Bill and the agreement that it implements will preserve the British rebate in full on all spending on the EU 15 and on all agricultural spending on the EU 27, irrespective of their accession dates. The abatement has the same basis as it did at its inception at Fontainebleau in 1984. The rebate will be disapplied only on non-agricultural expenditure, which primarily supports economic development in the member states that have joined the Union since 30 April 2004.

Andy Burnham: The hon. Gentleman is being extremely nit-picking. I invite him to read the own resources decision, and to look at the table in it that spells out how the rebate will be retained on all agricultural spending, and on all spending in the EU 15. As I have described—it would be good if the hon. Member for Runnymede and Weybridge (Mr. Hammond) read the decision before making his claims—it spells out how the rebate will be disapplied in respect of economic and structural spending in the new member states. That is how it affects the overall budget. Yes, there is an annual EU budget process, but it is informed by the own-resources decision, which the hon. Gentleman has clearly not bothered to read.

Andy Burnham: Thanks very much! I know that my hon. Friend is feeling bad because Scotland lost at the weekend, but that is no reason for him to take his nastiness and resentment out on me. This financial perspective does include reform of the CAP. I do not have the precise figures to hand, but it drops reasonably significantly as an overall percentage of the budget and member states are being asked voluntarily to shift spending away from simple direct support into helping improve the sustainability of local rural economies. So, yes, there is reform. If my hon. Friend is asking me whether that is enough, I would have to say no. We want more reform of the common agricultural policy. That is the very clear position of the British Government and we believe that we have secured the means—through the review of the process—to achieve it. It is not perfection. I am not arguing that the EU budget and the recently agreed own-resources decision represent perfection. We have made progress and continue to do so, because that benefits us all.

Andy Burnham: The hon. Gentleman keeps saying that we are giving up the rebate, but he has not listened to a word that I have said this afternoon. The own-resources decision outlines in detail the arrangements for the British rebate. Perhaps he will read that again before making a further intervention. I have said to him that the basis on which the rebate is calculated remains the same for the EU 15 and is being disapplied in respect of structural and cohesion funding in the new member states. He disagrees with that position. I have simply been making the point, particularly in relation to his and his right hon. and hon. Friends' efforts to woo partners from eastern Europe, that their failure to back our commitment, and to put up real resource to support the commitment to enlargement, means that nobody wants to join this new Movement for European Reform. They are on their own in Europe. All the western European economies have agreed to make this contribution to improve the competitiveness of eastern Europe. The Conservatives are completely isolated.

Philip Hammond: This is a very small Bill, with one operative clause, although after the Chief Secretary's speech I am grateful that it does not have 30 clauses. That one operative clause contains, however, the single biggest spending commitment in the whole of the Government's legislative programme. It is a £7.4 billion bill, addressed to the British taxpayer, and an hour and six minutes of obfuscation from the Chief Secretary has not changed that.
	This is a stealth Bill, sneaked in without a mention in the Queen's Speech and completely ignored in the Prime Minister's speech in the debate that followed. Far from being something of which the Government are proud, it is a Bill that dare not speak its name. The Prime Minister has done with this Bill exactly what he always does with bad news: he has tried to slip it in under the radar in the hope that nobody will notice it.
	It is in order to congratulate the Chief Secretary, who made a valiant attempt to defend the completely indefensible. He gave a fair impression of a man who has been living in a complete vacuum since 1999. He stood here and told us that the own-resources decision that the Bill will implement is a great victory for Britain, despite the fact that his own Government told us for years—until they gave way in December 2005—that they would fight tooth and nail to avoid that. The Government are not proud of the Bill, and neither should they be. Incidentally, it is interesting to note that the Chancellor is not in his place to support the Chief Secretary.
	The agreement that the Bill implements is a bad deal for Britain, and the Chief Secretary knows it. We know it, too, because when the former Prime Minister signed away Britain's rebate, the current Prime Minister briefed every journalist he could find that it was a bad deal, that it was all Tony Blair's doing and that he would never have agreed to it. A Treasury official put it this way at the time:
	"We have ended up giving away much more than we expected and with precious little to show for it in return".
	A senior aide to the then Chancellor—no prizes for guessing who—told the press that the sell-out would inevitably lead to public spending cuts. No wonder the Government want to get this Bill out of the way at the very beginning of the Session with as little noise as possible. It is an embarrassment and reminds us again of some of this Government's serial failings, such as duplicity, in repeatedly breaking their promises on Europe; incompetence, in failing to obtain anything in return for our money at the negotiating table; and fiscal incontinence, in throwing away yet more hard-earned taxpayers' money for nothing in return.

Philip Hammond: The right hon. Gentleman completely misses the point of the debate, which is the own-resources decision—the contributions of individual member states to the agreed disbursement budget. Nobody suggests that as a result of the Bill the amount disbursed under the EU budget will change, although if we chose not to support the Bill the composition of the contributions would change. I remind the right hon. Gentleman that under this proposal the UK will contribute an additional £19 billion net over the next seven years. If the rebate had not been given away we would still contribute an extra £12 billion over that period. There is, rightly and properly, an increased contribution to pay for the increase in the size of the Union—the price of enlargement.
	I shall continue with my narrative, if I may. The Prime Minister went off with his team to Brussels with clear objectives: first, to cap the budget at 1 per cent. of European Union gross national income; secondly, to shift the focus of EU spending from agriculture, with the ultimate objective of scrapping the common agricultural policy; and, thirdly, to keep the British rebate unless and until that reform was complete. So how did they do? They failed on every single one. The budget that this lot signed up to added more than £25 billion of extra spending. The Prime Minister claimed after the event that that reflected the cost of enlargement, but without reform, Ireland, whose per capita GDP is 30 per cent. higher than the EU average, is getting more per head than Lithuania, Slovakia or Poland. France will remain the EU's biggest recipient and the UK the lowest net recipient per capita.

Philip Hammond: I shall in a moment.
	Far from scrapping the common agricultural policy, the Government agreed to an increase in its budget in every year to the 2013 horizon. In fact, it emerged later that, despite the rhetoric, the UK Government did not table specific proposals for reform of the common agricultural policy during the negotiations. What they did achieve was a review, which, surreally, will be conducted during the French presidency of the Union, so I advise my right hon. and hon. Friends not to hold their breath. We can only speculate on the hilarity that will have been occasioned on the Quai d'Orsay by this display of British negotiating prowess.
	The UK team came back with no 1 per cent. cap on the budget and no reform, let alone scrapping, of the CAP. In accordance with the Prime Minister's formula, that meant no surrender of the British rebate, right? I am afraid that that was wrong. They returned not only empty-handed but with a pledge to send more bounty, in the form of a £7.4 billion reduction over the years 2008 to 2013 in the rebate that would have been payable to the United Kingdom were the own-resources decision not to be implemented in UK legislation.

Philip Hammond: I hesitate to be cruel to the hon. Gentleman, but I say to him what the Chief Secretary said to me earlier: read the papers before you come into the Chamber. The agreement has nothing to do with agricultural spend. It has to do with the own-resources decision—the contribution made by individual members. That is what the Bill will implement.

Philip Hammond: The hon. Gentleman refers to the link or otherwise between the spending decision and the own-resources decision. I shall come to that point in a moment.
	To return to the result from Brussels, the limit on the cost to the UK of the reduced rebate will end in 2013. Failure to reach agreement on a budget for the period after 2013 would have a devastating effect on the UK contribution, because the rebate reduction would become uncapped. We would have no effective veto, and thus no negotiating power, during negotiations on the EU budget for the period from 2013—and our partners in Europe would know it.
	There is one further twist to the tale. The Prime Minister, when he was Chancellor of the Exchequer, put it about that he was against the deal. When it was announced, the Treasury pointedly refused to endorse it and denied all responsibility, because it was worried that the deal would force future spending cuts. According to the Treasury briefing, the current Prime Minister was "quietly fuming". What did he do? This April, it became known that having failed to claw back some of the rebate through negotiation, he too had caved in and agreed to accept the original deal—the deal that he had previously condemned. So much for his powers of persuasion on the international stage.
	That is the sorry tale behind the Bill, although, of course, that could never be discerned from reading it. We, the Parliament of the United Kingdom, whose responsibility is to our electorate and our UK taxpayers, are invited to give the Bill a Second Reading, thus giving effect to what was done—in our name, but in complete contradiction of everything promised to us in this House—at Brussels in December 2005. If we do so, by 2010 the UK taxpayer will be footing the bill for an extra £1.9 billion a year—a sum roughly equivalent, fittingly enough, to the total Foreign Office budget—as a result of the sell-out on the rebate. That is in addition to the increase in the UK contribution to the underlying budget—£1.5 billion a year on average for the period 2007 to 2013—to deal with the cost of enlargement. Taking into account the loss of the UK rebate, which will increase our share of total EU costs, and the growth in the budget during that period, the UK's net contribution will more than double, from £2.8 billion a year on average under the previous financial perspective to an estimated £7.3 billion in 2013.

Andy Burnham: The hon. Gentleman keeps making that point, but he is completely confused. The 2007 to 2013 budget and the own-resources decision that determines how that budget will be financed are inseparable; they are part of a package. If he reads the own-resources decision, he will see that it sets out a schedule for how the payments will be calculated and indeed how the British rebate is to be calculated. How on earth can he continue to make the point that the two things are not part of the same issue?

Andy Burnham: The hon. Gentleman is straightforwardly wrong. I have the own-resources decision here. Clearly, he has not read it, but article 4 sets out the precise terms by which the UK rebate will be calculated between 2007 and 2013. That is the framework by which the EU budget will be determined in the next financial perspective.  [Interruption.] It is part of the package. The two things sit together.

Philip Hammond: I advise the Chief Secretary to stop digging. He is right that the own-resources decision sets out the mechanism by which the British rebate adjustment will be calculated—of course it does—but it does not set out the EU budget, which is what he has been spouting on about for most of the debate.
	Let me come to the critical point. If we decline to give the Bill a Second Reading, what will happen? Will the roof fall in? Will the sun not rise in the east tomorrow morning? Nothing will happen. Life—even life in the EU—will go on exactly as before. The existing own-resources decision will continue in force, indefinitely if necessary. The total expenditure budget will not be affected. The only difference will be that member states' contributions will continue to be assessed on the same basis as they were last year and the year before. The UK will remain the EU's second largest net contributor, but we will have £7.4 billion more to spend on British priorities; perhaps we could use it to reverse some of the Government's most recent round of stealth taxes or reduce the £143 billion that the Chancellor plans to borrow in the next five years.

Philip Hammond: I know that the Treasury operates only a static model. The Chief Secretary would be right if everything else were static, but the budget is increasing. If the Bill is passed tonight, as he knows, our contribution will increase by an element that reflects the surrendered rebate and by another element that reflects the underlying increase in our contribution to the EU budget. If we do not give away the rebate, the UK contribution to the EU budget will still increase.
	I know that I am damning the Chief Secretary with faint praise, but even he could make a better fist of spending £7.4 billion of British taxpayers' money than the EU. Last week, the European Court of Auditors refused to sign off the EU accounts for the 13th year in a row. The accounts are riddled with material errors and irregularities—for example, the irregularity that receipts are still not collected for MEPs' expenses, and the material error by which money earmarked for agriculture is spent on golf clubs. That is to say nothing of the £3.8 billion a year that the EU spends on propaganda—public relations staff, pamphlets, teaching aids, school trips and cartoons. There is the originally named "Captain Euro", whose mission is apparently to uphold the EU's values—perhaps he could find time to fight fraud and waste as a sideline.
	At a time when many priority areas of public spending are under intense pressure in the UK, how can this Government contemplate giving away £7.4 billion of British taxpayers' money in exchange for absolutely nothing? That money would pay for 45,000 nurses, 37,000 teachers, 42,000 prison places or, if the Chief Secretary prefers this currency, 1.2 million hip replacements. It would also pay for much-needed equipment for our front-line troops in Afghanistan and Iraq.
	We are used to this Government's casual attitude to public money: £5.7 billion was wasted on tax credit overpayments; £3 billion was spent on nine NHS reorganisations in nine years; and £141 million was wasted on an abandoned Department for Work and Pensions IT programme. We are used to tough rhetoric on Europe followed by craven surrender, and we are used to broken promises: there were broken promises on the referendum; a promise has now been broken on the rebate; and no doubt promises will be broken on the red lines. The Bill is so objectionable, because it embodies all those failures of government in one measure.
	We were promised that the rebate would be non-negotiable, yet it was surrendered without a fight. The Government talked tough about how they would force the scrapping or at least the radical reform of the CAP, but the CAP will remain untouched. At a time when our public services are feeling the squeeze, when our troops in the front line are short of equipment and when our schools are falling down the world league table, this Government propose casually to chuck away £7.4 billion of our money. By giving away our rebate, which has been worth £54 billion since it was negotiated in 1984, without securing anything in return, this Government have manifestly failed in their paramount duty to protect Britain's interests.
	We have a chance to salvage the situation. By rejecting this Bill tonight, Parliament has the opportunity to rectify the damage caused by the incompetence and duplicity of this Labour Government, to stand up for the interests of Britain and British taxpayers against a Executive who have broken their promises and betrayed the people's trust, and to send a clear message that Britain's hard-won rebate is not for giving away. I urge hon. Members to seize the chance this evening to send the Government back to the negotiating table in 2008, in parallel with the promised budget review, and to enter into a good-faith discussion about the rebate, the budget and the future of the CAP on the clear basis that all three are linked and that there will be no change to the British rebate formula unless there is long-term, sustainable reform of the CAP. This is our last chance. If the Bill is passed, Britain's rebate, and with it the principal lever to secure sustainable reform of the CAP, will be gone. I urge hon. Members to deny the Bill a Second Reading and to keep the cause of EU reform alive.

Denis MacShane: I do not want to make this a Polish-Polish debate, but I ask the hon. Gentleman to reflect a little on what he has said. In 1982, the communist secret police in Poland put me in prison for taking money to the underground Solidarity union. The following year, Britain imposed swingeing visa controls against allowing Poles to come into the United Kingdom. The year after that, Mrs. Thatcher was talking about that faded communist hack Gorbachev as a man with whom she could do business. I accept that once the Poles had won their freedom, Mrs. Thatcher came round to accepting that that was a good thing. However, I wish that she had been a bit stronger in her support when I was in prison, and when the Poles needed to come to this country a bit more easily.
	Thanks to the joint work of the Labour and Conservative parties in facing down the anti-eastern-European tabloid press, Poles have been able to come here. However, the tabloids are once again screaming against the eastern European ladies and gentlemen working here.
	Yes, I accept that Britain will now pay a bit more. I have no problem with that, because we have had a good deal from the rebate in the past 24 years. Despite what the shadow Chief Secretary said, we are not, in per-capita terms, the largest or second largest contributor to the EU budget. Page 32 of the very good Library report shows that we paid 68 euros per head last year. The Netherlands pays four times as much, at 241 euros per head; Denmark pays twice as much at 127 euros per head; Sweden pays 124 euros per head, while Germany pays 100 euros per head. France and Austria pay 50 and 40 euros per head respectively. Those countries, too, are pretty fed up with the assumption that Britain does not have to pay its fair share.

Denis MacShane: I love my hon. Friend the Member for Great Grimsby (Mr. Mitchell), but he has not been in his place since the beginning of the debate, and neither has the hon. Member for Na h-Eileanan an Iar (Mr. MacNeil), so I shall not give way. I will do so to those who have been here since the start of the debate.
	As well as making us more wealthy, it transpires that membership of the EU makes us more healthy. A new book that has just become available in the Library, in the new arrivals section, contains a marvellous statistic showing that between 1965 and 2004, the life expectancy of the British male increased by 13 years. In the United States over the same period it increased by only eight years; in France, it increased by 10 years and in Norway by just seven years. Membership of the European Union is allowing us to live longer; I would have thought that all hon. Members would welcome that.
	This modest Bill will allow financing of the European Union that has been negotiated, agreed and signed, and on which our word has been pledged. The shadow Chief Secretary to the Treasury is quite right to say that we can veto it and reject it, but he would have a hard time explaining to the Poles, Hungarians, Czechs and other eastern Europeans who are the principal beneficiaries why we should continue the current practice, which will come to an end once the Bill becomes law, of their sending large cheques to Her Majesty's Treasury. It is not worthy or honourable. The Conservative party is not anti-Polish or anti-European, but it seems to be absolutely locked into a philosophy of rejecting anything that helps the EU to grow.
	This time last week, the shadow Foreign Secretary, the right hon. Member for Richmond, Yorks (Mr. Hague) made endless appeals in a fine and effective speech for more European Union action. He said that EU Foreign Ministers had wasted opportunities and that they ought to do more on Iraq. I agree with him. On Burma, he says that the EU should tighten
	"targeted sanctions against the military regime".—[ Official Report, 12 November 2007; Vol. 467, c. 419.]
	I cannot disagree with him. He also said that EU Ministers need to show collective strength over Zimbabwe. I agree with him, but if he wants those desired goals to be achieved, there is a problem. It is not possible to demand more action from partners in Europe—I might add the case of Afghanistan or one or two other places—at the Dispatch Box while allowing members of one's party to campaign openly for withdrawal from the EU, or while writing articles and making the bulk of one's speeches utterly contemptuous of our partners. When the Leader of the Opposition talks about one-legged Lithuanians, the Opposition have a problem. When members of the Public Accounts Committee say, "We're going to have to get tough—these guys coming in to talk to us are foreigners", we see the subconscious xenophobia deep at the heart of the Conservative party.

Julia Goldsworthy: It would be fantastic if that were the case, but unfortunately it was a hard fight even to get Cornwall recognised as a distinctive economic region in its own right, which neither the Conservative nor the current Government were prepared to countenance. Only through the work of the then MEP Robin Teverson, now Lord Teverson, was the area identified as an economic entity in its own right.
	The second point that the right hon. Gentleman made was about the need for reform of the common agricultural policy and about how we should make the most of our opportunities. However, as I shall explain, we had an opportunity but we passed up on it.
	We on the Liberal Democrat Benches are not going to engage in anti-European rants. We have always been clear that we take a constructive, pro-European approach, which we do not intend to change. We welcome the fact that the EU has brought a period of unparalleled peace and prosperity to Europe, and that there has been successful integration with new member states. However, that does not mean that there is no need for a proper public debate about the future of Britain's relationship with the European Union.
	Over our 35 years as a member state we have seen the EU widen its membership and share sovereignty, from Mrs. Thatcher's Single European Act to a succession of treaties agreed by both Conservative and Labour Governments. The EU has changed beyond recognition since 1973, which means that the need for a renewed debate has never been greater. Since 1997 Labour has given away powers, but has refused to make the positive case for Europe and engage in a proper debate about the direction of the EU. The Conservatives, who promoted closer integration without referendums while in government, now indulge in populism of the worst kind, calling for a referendum to mask their own divisions. So let us have that proper debate.
	That debate could be achieved by a referendum on Britain's membership of the EU. That was raised on the Liberal Democrat Benches during the debate on the Loyal Address, and I was proud to walk through the Lobby supporting our amendment, which would have delivered that. I was disappointed that the Conservatives chose to oppose such a proposal, or are they afraid that too many Conservatives Members would vote to withdraw from the EU altogether? Instead, the Conservatives will use the debate on the treaty as a proxy for that debate, despite the fact that it has much narrower terms. I am sure that those opposed to EU membership altogether will take the opportunity to air their views then, but much of the treaty is in fact about the practicalities of dealing with an enlarged EU, such as whether we need 27 commissioners.
	We need to see the Bill in the context of that wider debate about a constructive approach. Although the Bill is short, it gives effect to the new own resources decision made by the European Council on 7 June 2007. The Bill sets out the new financial framework for the EU for 2007 to 2013, the basis of which was agreed under the UK presidency in Brussels, in December 2005. We on the Liberal Democrat Benches believe that the EU is good for the UK. We support measures to enable smooth running of the expansion of EU membership, and we believe that it would be wrong to defend an arrangement under which we were recipients of funding from eastern Europe. Those measures were part of the negotiations for a new financial framework—a part that we wholeheartedly supported, because we wish to support the poorer parts of the European Union, which means those in the UK as well as in the new accession states.
	The key point is that the negotiating objective was to trade the rebate against fundamental change. The question we must ask is: could the Government have done more in trying to achieve that fundamental negotiating objective? The Minister has not conceded today that the end result was a bad deal for the UK. It was a bad deal because the former Prime Minister totally failed us in the negotiating process during his six-month presidency of the EU. He seemed to think that any deal was better than none at all. The result is a bad deal, caused by the Government failing to identify, let alone secure, their objectives. That result is more the legacy of the former Prime Minister than the vision of the current one, which is probably why he chose not to raise it in the Queen's Speech.
	The former Prime Minister, Tony Blair, liked talking about grand ambition and using radical rhetoric about reforming the EU, but when he had his golden opportunity he failed to deliver. He totally mishandled the negotiating process before it had even started. He spent most of 2005 saying that the rebate was non-negotiable. Clearly, however, it was negotiable, and was actually being negotiated at the time he was saying that it was not. The hon. Member for Wolverhampton, South-West (Rob Marris) spoke earlier about negotiating skills; perhaps he should have shared some of his expertise with the then Prime Minister, who completely failed in that regard.
	Such a position resulted not only in the Government looking foolish. It also meant that they could not open up terms of compromise from anyone else. Perhaps it would have been better to say, "Okay, we'll put our rebate on the table if you're prepared to talk about the serious reform of the common agricultural policy." But they did not, so they had absolutely no hope of delivering reform of that kind. The best that they could do was to cave in on the rebate, while giving the pathetic excuse that it related only to the expansion elements, and not to those linked to the CAP.
	This was the area of greatest opportunity, and of greatest failure. Too much was given up in return for too little reform. There was an opportunity for a long-term strategy to be put in place, but the former Prime Minister bottled it. Instead of a long-term sustainable solution to CAP reform being found, the issue was effectively kicked into touch, with a full review of EU spending and resources by the Commission scheduled to report in 2008-09. In other words, it will become someone else's problem.
	Today's debate has highlighted the fact that the urgent need for CAP reform has still not been addressed. We have seen significant reform, but we need to go further. It was good to see the reforms in 2003. Despite the problems that the Government have had with the administration of the single farm payment, it is less bureaucratic than its predecessor systems, and it is no longer awarded on the basis of production. However, there is still a need to go further, to increase trading opportunities for developing countries while safeguarding the changing rural economy. The Government should have been more ambitious in what they believed they could achieve.
	The Treasury set out its vision, to "stimulate and inform debate", on 2 December—about the same time as the meeting in Brussels took place. This gave an indication of where it believed the EU needed to be in 10 to15 years' time. Operating on that time scale, the Brussels Council should have been crucial to taking the first steps, yet that opportunity was missed. The Treasury document highlighted many of the issues that need to be tackled and, yes, tariffs remain one of the key obstacles to further and more fundamental reform. The Government's position in 2002, in failing to secure a renegotiation of the CAP, not only undermined their position at the summit in Brussels in 2005, but also impacted on the subsequent World Trade Organisation negotiations.
	Instead of kicking the issue into the long grass with the review, the Government should have looked much more closely at potential co-financing arrangements and at splitting the responsibility 50-50 between the EU and the national Governments. This would have had a much greater impact on the rebate than the measure that we are debating here today and the sums of money that we are talking about.
	The Chief Secretary to the Treasury talked about the way in which resources had been allocated across from pillar one to pillar two of the common agricultural policy. Those are the kinds of issues that really should have been pushed at the Brussels Council. Such an approach at Brussels would have helped to bring decision-making powers—and with them, decisions over resources—back from Brussels to a more local level within the UK. That would have put money back into rural communities, using public money for the delivery of public goods. It would have encouraged food to be produced and sold locally to high animal welfare and environmental standards, which would have cut food miles and ensured sustainability. Fundamentally, it would have made a real difference, but the opportunity to get those changes moving was wasted.

Austin Mitchell: I do not want to follow on from what the hon. Member for Shrewsbury and Atcham (Daniel Kawczynski) said, but I must put him right on Iceland. What he mentioned was not done by Roy Hattersley and it did not happen in 1978, because he was not in the Foreign Office at that time. The settlement was in 1976 and the proposals that Roy Hattersley turned down were made in 1974. The hon. Gentleman would have done better to stay off Iceland altogether. Apart from that, he made a good speech.
	This is a nice opportunity to take part in one of the three-monthly contests between Eurosceptics and Euro-enthusiasts on which we spend so much time in this House. It is nice to welcome two new Ministers in the field as umpires or referees in the contest—my congratulations to both of them. I shall not put forward a view that accords with their policy or with official policy, because I shall not vote for this measure, and I would not want to give the impression that speeches by Labour Members will be, with one exception, that of my hon. Friend the Member for Luton, North (Kelvin Hopkins), panegyrics on Europe.
	I am sorry that my hon. Friend the Member for Grantham and Stamford (Mr. Davies)—my new Friend—has left the Chamber, but it was good to see him get all that accumulated bile about the Conservative party off his chest. I am sure that it did him a lot of good. It was interesting to see, but I do not think that those views will do him as much good under our new leadership as they would have done under the previous leadership until July—the bid is a bit late.
	The basic problem that we face with this Bill is that it adds to the costs of belonging to the European Union, which are already unacceptably high for this country. After Germany, which is much more generous and committed towards Europe, we have long been the second highest contributor. That situation has been compounded by the concessions made on the rebate by our previous Prime Minister, whose name slips my mind temporarily, earlier in the year without much consultation with Labour Members.
	The rebate was negotiated unwisely by Mrs. Thatcher, because it addressed some of the problems that the structures and financing of the European Union placed on this country unfairly and unequally. However, it was wrong to give up any part of that rebate, and in particular to do so without concessions in the negotiations in return. One should not just make generous impulsive offers and throw all one's cards on the table
	Europe is a matter of continuous negotiation, albeit a rather annoying and embittering one. In the negotiation, one must play one's cards and games in return for sacrifices. My concern is that there were no reciprocal gains and we got nothing in the negotiations, either on the treaty, which was also in play and being negotiated at the same time, or on the budget situation that has been so damaging to this country. Before those concessions, our contributions, which will increase under this Bill, were between £7 billion and £8 billion gross over the past few years.

Austin Mitchell: Yes, and I am grateful to the hon. Gentleman for making that point.
	The Bill will increase our gross contribution to £10 billion—which will rise to some £20 billion after 2013—and the net receipt to £6 billion. I ask those hon. Members who say what a benefit the system is to the rest of Europe to envisage how many roads, schools, hospitals and health centres could be built here, at our discretion and for our purposes, if we were not making that annual contribution. We are told to rejoice that Italy and France are now beginning to pay something after all the years of paying nothing, but the proportionate increase in their contribution is less than in ours, and we have been making the second highest contribution.
	Our Government's contribution is about 0.5 per cent. of our GDP, and that is important, because that is the growth from which the people of this country benefit, but it is not our only contribution to Europe. We also make contributions to European institutions of £1.8 billion in total, including for instance the blessings of the Galileo project, which is to send 20 flying pigs into space to bounce back a location system that we get free from the Americans at the moment, so that our motorists and defence forces can pay for it. I come back to the CAP—I am sure that the hon. Member for Dundee, East (Stewart Hosie) will rejoice. The net cost of the CAP to us, by the OECD's estimate, is £15 billion a year. That is partly in distortions to the market, but it is also the cost of not buying the cheaper food that is available on world markets, and being forced to buy the over-priced production from Europe. What could we do with that £15 billion?
	Then there is the cost of the European regulations that are showered on us, some necessary and some not. Estimates vary and some are higher than others, but let us say £25 billion a year. Add that lot up and we are contributing between £45 billion and £60 billion a year to belong to that institution. It is some 2 per cent. of GDP, so in other words our growth would have been 2 per cent. faster each year had we not been making those contributions. That growth is cumulative, so at the end of 10 years our economy would have been that much more powerful—and that much better able to contribute to the needs of developing countries.
	Cumulative growth has been lost, and that is a burden that has been assumed without asking the British people, and it is also a loss across the exchanges. We are in a substantial and growing balance of payments deficit, and we are adding to that by the flow across the exchanges. We have already suffered damage to manufacturing in this country. When we joined, we had a surplus in manufacturing trade with Europe. Now we have a steadily growing annual deficit. We have paid for that in previous years through a surplus with the rest of the world, but that has now gone, too. There is a massive drain on the balance of payments, which will only get worse if we carry on this course.
	Where has all that money gone? Where does the £45 billion to £60 billion go? My right hon. Friend the Member for Rotherham (Mr. MacShane), who is working hard for his European knighthood or whatever will come at the end of his long travails, said that it was going to help the Poles. Well, that is a wonderful purpose, and I am glad to help the Poles. I do not mind them: in fact, I quite like them coming here to help us, because our contribution does not keep them there. But what right has my right hon. Friend, or any other of my right hon. and hon. Friends, to be so generous with our money for those purposes?
	Where has the money gone? It cannot all have gone to pay Mrs. Cresson's dentist the massive sums that he was receiving for advising in her office. It cannot all have gone on corruption, which adds 10 per cent. to so many budgets—all of them unqualified. My new hon. Friend the Member for Grantham and Stamford was quite wrong to say that it was not the Commission's spending, because it is the programmes that the corruption occurs in, and Europe is responsible for those programmes. Is the money going to the Spanish, to build fishing vessels to come and catch our fish and take it off to Spain? Is it going to farmers in the Republic of Ireland and France? I am sure that they do better out of the CAP and the aid than do the Poles, who are the poorest in Europe. Where is our money going and what benefit do we get from it?

Austin Mitchell: If I accepted that specious point I should be criticising my leader and I would never ever do that. Let us say that there is a contribution across the exchanges rather than an assessment of the budgetary position.
	What benefits do we get? There is a mantra. The Government and euro-enthusiasts always tell us that inestimable benefits flow from Europe. They say inestimable, as a reason for not estimating them. Year after year I have tabled questions asking for a balance sheet of the gains and losses of our membership of the EU. Lord Pearson, who represents the provisional wing of the UK Independence party in the House of Lords, tables an annual motion asking for a balance sheet, but we are never told what the benefits are.
	We are told that many jobs are dependent on Europe. That is just not true; those jobs would exist whether we were in the EU or out of it. Exports and trade would continue.

Angus MacNeil: It is argued that one of the benefits of EU membership involves fiscal transfers. Does the hon. Gentleman agree that there may also be many inestimable benefits to the EU area, witness Iceland, Norway and Switzerland?

Austin Mitchell: The countries that have done best economically are outside the European Union, especially smaller countries such as Switzerland and Iceland. They do not have to bear the EU's burdens, so they have had much faster growth than us. EU growth has been laggard.
	What benefits do we get? We certainly cannot claim the common fisheries policy as a benefit. No one would defend that. Nobody seems to claim the CAP as a benefit, apart perhaps from the hon. Member for Dundee, East who said it brought stability, but it brings stability at enormous cost and distorts our market.
	Nobody would say that the other common policy—foreign and defence policy—has achieved much. How successful was it in Yugoslavia? It was largely responsible for breaking up Yugoslavia. The EU was pushed into intervention in Kosovo by President Clinton. Look how united and solid the EU was on Iraq, where it fell into squabbling camps. In Afghanistan, we are being left to bear the brunt of the fighting and death while German troops have to clock off for tea at 5. Again the burdens fall on us.
	As my hon. Friend the Member for Luton, North said, there have been two surveys of the costs and benefits. The Swiss drew up an honest balance sheet for their Department of Foreign Affairs. It indicated that the burdens of Europe would take 1 per cent. from their annual growth. A French think-tank—pro-Government—obviously influenced Sarkozy, who wants the European Bank to lower the exchange rate and interest rates to make the euro more competitive. The French survey showed that economic and monetary union has damaged growth and turned Europe into the high-unemployment, low-growth black spot of the advanced world. There have been glimmerings of growth in Germany—I am sure my new hon. Friend the Member for Grantham and Stamford would intervene at this point—but the EU is growing far slower than any other part of the world.

Austin Mitchell: No, I am grinding slowly to a halt. It is a painful process for the House that I do not particularly want to interrupt.
	Reality is not mindlessly handing over money to every demand or mindlessly saying that we benefit from an institution that is in fact doing us harm, and which is constructing over our heads a state that will be set above our own nation state. We need an honest, objective measurement of the benefits and debits of membership—I hope we shall be given it by our Government. That would be a sensible basis for making a decision about our relationship with Europe. The decision may take the euro-enthusiast direction that my new hon. Friend the Member for Grantham and Stamford and my old friend, the right hon. Member for Rotherham, want, but it may not. People may ask, "Why should we spend all this money? Why should we donate all this money and suffer disadvantages and losses? Why shouldn't we build up our economic strength and decide our economic destiny?"
	Let us see the balance sheet; then we can decide whether we are prepared to pay. Naivety is interesting and useful—perhaps necessary—in courtship, but it is no basis for a long marriage.

John Redwood: In 1984, as a young man, I was the chief policy adviser to the then Prime Minister. One of my proudest moments in that job was when she returned from a difficult negotiation in the European Community where, thanks entirely to her skill, determination and perseverance, she obtained for the UK a most important reduction in the amount that we had to pay into the European Economic Community.
	It was a great negotiation because to achieve that rebate, that lady had to persuade all the other member states to her point of view. She could not block the payments that we were making because a Labour Government had agreed them. She knew they were far too high, and it was her consummate skill as a negotiator and politician that slowly persuaded all the other member states, reluctantly and gradually, to the view that Britain was getting an extremely raw deal; it was paying far too much, and justice required that more of the money should be left in the United Kingdom.
	As a result, the Government whom she led and those led by her two successors were able to spend more money on British public services chosen freely by the elected representatives—the majority party in this House—or to return more money to the British people to spend on their own families and businesses through tax reduction, which I greatly welcomed. That makes tonight particularly tragic, because a subsequent Prime Minister, Mr. Blair, went to a European negotiation at which all he had to do was say no. He need not have given any of that money away. He did not need any of the skills that Baroness Thatcher required to win us the rebate—he had all the cards in his hand. He merely had to say no unless and until the other members of the European Union saw the justice of the case that he was making.
	When the former Prime Minister moved his position, from the excellent one that there was no need to give up the rebate and that it was not negotiable, to the position that it was negotiable, I and many of my right hon. and hon. Friends had misgivings. The Opposition were prepared to listen, however, and see whether it was feasible to negotiate a much better deal on the spending side of the account, whereby the British position would not worsen, while that of all members of the Union would improve if spending could be reduced on agriculture. Such spending gets in the way of efficient agriculture in many member states and prevents developing countries from getting fair access to our markets.
	Some of my right hon. and hon. Friends withheld their criticism to wait and see whether the then Prime Minister had some negotiating skills. It beggars belief that he had absolutely no negotiating skills at all. Armed with the veto, he threw it away. Armed with a strong case to win over the new member states and the Nordic member states to the proposition that the common agricultural policy was bad and should be reformed, he was unable to persuade any of them. Tonight, we have a House of Commons with Labour Members almost in denial and about to vote through a disaster for the United Kingdom in the form of an extremely large bill that we cannot afford and do not want.
	The Chief Secretary to the Treasury, who opened the debate, showed bravado and obviously implied that he thinks everyone in the country is a fool. He tried to present the Bill as some kind of negotiating success and a way of increasing the rebate. Yes, of course it increases the rebate, because it increases the spending by so much more. It means that Britain will end up paying far more in the seven years of the proposal than if nothing had been given away in the negotiations.
	I notice that the Economic Secretary to the Treasury, who is on the Treasury Bench, has no intention of intervening, because she knows that I am absolutely right about the huge expensive. The documents reveal costings of £7.4 billion at the current euro-sterling exchange rate. Given the parlous state of the national accounts, we know that every penny of that £7.4 billion will have to be borrowed. If it were borrowed over, say, a 20-year period at 5 per cent.—the Government might be able to do that—there would be another £7.4 billion of interest on top of the £7.4 billion of capital that will need to be paid and then repaid over the 20 years of the debt. I leave out the interest on the interest, which would add to the sum even more. On the Government's own admission in the explanatory notes to the Bill—they are riddled with errors, of course, but I do not think that this figure is an error—the minimum cost to the state and the taxpayer will be £7.5 billion, which, in practice, will mean £15 billion or more, because they will have to borrow it and we will have to pay interest on it.
	If we look beneath the Government's guidance, we see that the true bill to the taxpayer and the British Government will be far bigger. This Government have signed up to a set of spending plans that mean that, on average, every year over the seven-year period the United Kingdom will have to pay £10 billion into the European Union, after knocking off the smaller rebate, which is still in place thanks to Baroness Thatcher. That means that, in practice, there will be an underlying spending increase of £70 billion over a seven-year period. Using my simple sum, if the Government borrowed that over 20 years at 5 per cent., we are talking about £140 billion of first-round interest payments and capital repayments, just to see us through the seven years. At the end of the seven years, of course, we know that we would be on another escalator, because our bargaining position would be greatly weakened thanks to the Government's foolishness in giving away this most important principle and allowing the rebate to be weakened.
	We know that the present Government are careless with public money. They say that any Conservative plan to spend a few hundred million or the odd billion on a tax cut would produce a black hole, yet along comes a mortgage bank in trouble and they can suddenly find £24 billion without batting an eyelid. Now we discover that they can apparently pledge this country to pay £70 billion over the cycle of the budget proposal. We know that they can propose that only because they intend to borrow every penny of it, just as presumably they are borrowing every penny of the £24 billion that they have so far made available to Northern Rock.
	The Chief Secretary to the Treasury produced several arguments, in the course of a long and rambling speech, for why the budget was a good deal for Britain. There was the strange argument that the rebate was going to increase, whereas we all know that there will be a worsening of the rebate and increased spending. There was then the argument that we should be extremely grateful and welcoming of the fact that, as a result of our much bigger contribution to the European Union kitty, there would be more spending in countries outside the United Kingdom. He implied that he believes that, as soon as a country gets European Union spending, it becomes more prosperous and its growth rate rises. That is a curious argument.
	During my time in politics in Britain, I have seen some parts of the United Kingdom receive European Union money. We know that they have been receiving it because, as has been pointed out in the debate, one condition of it is that recipients have to stick the 12-star flag logo all over the sign boards for the projects, whereas I believe that under British law they are not allowed to put a Union flag on anything that we fund directly. Somebody rightly pointed out that the money is ours anyway, because we put more in than we get back. We know that some places have been getting that funding.
	If we look, as I have, at the income levels and growth rates in the places that receive that funding, we see two interesting things. First, the poorest parts of the country receive the money. That is not surprising, as the main condition for getting it is that they start as the poorest parts of the country. The other thing that we discover is that, under this Government in the past decade, those areas have also had the slowest growth rates. The money is clearly not kick-starting those parts of the country into greater prosperity; it is part of the problem that is holding them down.

Nia Griffith: I must disagree. We have ways in which to disburse funding and we are beginning to make a genuine difference in our peripheral areas through many projects, including the settlements that have been given to the devolved Administrations.
	Clearly, one cannot make up a huge difference in a short time. The comparison with London is therefore unrealistic, but a huge leap forward has been made. We had a difficult coin to toss on convergence funding in Wales. Would our position be so improved that we would not get the convergence funding, or would we continue to be classified as needing it? It was a strange dilemma, because on the one hand we wanted to be poor enough to get the European money, but on the other, we would have liked to celebrate being not so poor as to attract it. However, we were clearly borderline, and we have been lucky because we have made progress, but we have also benefited from another £1.4 billion for Wales.

David Gauke: It is a great pleasure to wind up today's debate. Those of us who deal with Treasury matters are used to Finance Bills, so a Bill with only one operative clause appears somewhat less daunting.
	The debate has also been a pleasure because of the range of views heard. From Conservative Members, perhaps not surprisingly, we have heard forceful criticism of the deal facing us, and of the consequences that will flow from enacting the Bill. Such contributions were made by my hon. Friends the Members for Altrincham and Sale, West (Mr. Brady), for Shrewsbury and Atcham (Daniel Kawczynski) and for Broxbourne (Mr. Walker) and by my right hon. Friend the Member for Wokingham (Mr. Redwood). We also heard strong speeches making precisely the same point from Labour Members, particularly the hon. Members for Luton, North (Kelvin Hopkins), for Great Grimsby (Mr. Mitchell) and for Glasgow, South-West (Mr. Davidson).
	We have also heard the counter view from the right hon. Member for Rotherham (Mr. MacShane) and the hon. Member for Grantham and Stamford (Mr. Davies). Until the hon. Member for Llanelli (Nia Griffith) spoke, I thought that the hon. Member for Grantham and Stamford was going to be in a somewhat isolated and minority position in his own party on this issue—once again—but it was not to be.
	The simple question dealt with by the Bill is whether the deal obtained by Tony Blair in December 2005 was a good one and in Britain's interests. He went to negotiate with an objective to protect the rebate, to limit EU spending and to reform the CAP. He delivered on none of those. Our gross contributions are up, what we get back is down, and our net contribution is up. Moreover, our negotiating position for the next financing period has been horrendously undermined. The UK will therefore pay the price for this deal not just until 2013 but for the seven years after that. All that has occurred at a time when, as my right hon. Friend the Member for Wokingham made clear, we had a veto—we had an ability to block something that was clearly against our interests, and we failed to do so.
	The argument is made that the deal is all about redistribution from the wealthy west to the poorer east. But let us look at the facts—the comparative data. What do they tell us about the winners and losers from the budget settlement and the own- resources decision? The Government will not give us all those figures, but Open Europe has obtained leaked copies of working papers, and there is little link between spending and needs. The highest per capita spending is in the EU's wealthiest country, Luxembourg. In second and third place are two members of the original EU 15, Belgium and Greece, not new accession countries. Ireland, one of the richest countries in Europe, will receive more per person than eight of the 10 accession states. To be fair, there is one western country that does do poorly. The country that does worst in terms of funding is the United Kingdom.
	How is it spent, this money that will do so much for the eastern countries? Administration costs are rising by 28 per cent. between 2004 and 2013, to £34 billion. Between 2000-06 and 2007-13, the common agricultural policy budget has risen by 12 per cent. The hon. Member for Glasgow, South-West made a good point about the need to return structural funds to member states, a point also made by the Prime Minister in the past, but that has not happened either: it is another failed negotiating objective.
	The accounts, of course, have been rejected by the Court of Auditors for the last 13 years. I say that fearing that I may aggravate the hon. Member for Grantham and Stamford, who became very worked up about the allegations, saying that this was nothing to do with the Commission. I refer the hon. Gentleman to the European Scrutiny Committee report's summary of the statement of assurance produced by the Court of Auditors. It gave as an example of a reservation
	"the incidence of omissions and double or wrong postings"
	in the Directorate-General for Education and Culture. It also referred to
	"structural measures, internal policies and external action"
	and said that
	"payments are still materially affected by errors."
	It expressed the view that the Commission and member states needed to make much greater efforts
	"to implement adequate supervisory and control systems".
	That applies not just to member states, but to the Commission.

Kitty Ussher: We have had an interesting debate in which several Members, not least the hon. Member for South-West Hertfordshire (Mr. Gauke), have shown their true prejudices for all to see. I feel that we have been here before and that no doubt we will be here again. The highlight for me was the contribution of our new friend, my hon. Friend the Member for Grantham and Stamford (Mr. Davies), who gave an excellent speech. Opposition Members said they would not take him back; we are not letting him go as he is able, in a way that no one else is, to speak with inside knowledge about the Conservative party's sheer hypocrisy on European Union matters. He said that the Opposition parties' purpose was to defeat this Bill in order specifically to cause a constitutional crisis in Europe, which is what they want.
	We have heard a lot of facts and figures this evening, so let me start by explaining the true ones. This is a good package for Britain. The abatement is preserved —[Interruption.] Of course it is; it is in writing in the own-resources decision, which states:
	"The European Council of 15 and 16 December 2005 concluded that the correction mechanism in favour of the United Kingdom shall remain".
	I have it here in black and white. It continues:
	"However, after a phasing-in period between 2009 and 2011, the United Kingdom shall participate fully in the financing of the costs of enlargement, except for agricultural direct payments and market-related expenditure".
	The rebate as a whole will remain. It has not been signed away and will remain in full on the common agricultural policy across old and new EU member states and on all spending in the EU 15. It is right that we pay our share towards reconstruction in eastern Europe and it is in our national interest to do so. Not only that, our abatement is worth more in this budget round than in the previous one. We will get back €40 billion, which is an increase on the €34.5 billion in the previous round. Over the period, Britain and France will contribute roughly the same, which Conservative negotiators never achieved. The net contributions of France and Italy will rise twice as fast as ours.
	Under this deal, the EU budget as a whole has fallen below 1 per cent. of European Union gross national income, which is a saving of €160 billion compared with the Commission's original proposal. The deal that we agreed is 20 per cent. less than the last budget agreed when Conservatives were attempting to negotiate for the Government. In 1988, the then Government signed up to a deal that saw the budget grow by 17 per cent. over five years, and in 1994 they signed up to a budget that was shown to grow by 22 per cent. We have signed up to a budget for an enlarged EU that will grow by a mere 7 per cent., working in the national interest.
	We have secured a commitment to a fundamental review of the budget. The CAP, which was two thirds of the budget in the mid-1980s, will no longer be the largest part of the EU budget. The value of the CAP will start to fall in real terms from this year, from €55 billion to €51 billion by 2013. That has been negotiated by this Government. The budget now gives help to the new member states of eastern Europe, which need it most. It is in the national interest to pay our fair share of the cost of enlargement.
	I want to refer to some of the questions and contributions in this evening's debate. The hon. Member for Falmouth and Camborne (Julia Goldsworthy), who speaks for the Liberal Democrats, said that she wanted a debate on EU membership. She accepted that CAP reform was going the right way, but then she confirmed that she will vote against the Bill. The Liberal Democrats are, as always, trying to face two ways at the same time. She said that it would have been better to have had no agreement than to have the agreement reached in 2005, and other Opposition Members tried to make the same point.
	It was essential to have a December 2005 deal to allow the new member states to start preparing to use EU funds and to avoid the European Parliament, in the absence of such a deal, setting annual budgets under existing funding arrangements that, just to give one example, would have cost Poland about two thirds of its EU funds. Reaching no deal would have betrayed our support for enlargement. Perhaps the Opposition parties' support for no deal betrays their lack of support for enlargement.
	The hon. Member for Falmouth and Camborne said that Cornwall is still a very poor area. We are happy that it will continue to be supported. Cornwall and the Isles of Scilly will receive €430 million in convergence expenditure in the current financial perspective.
	My hon. Friend the Member for Luton, North (Kelvin Hopkins) made a number of points. I do not agree with all of them, but I was grateful for his contribution. He said that the CAP and structural and cohesion funds should be nationalised. On the CAP, the Government's policy is the abolition of market support and direct payments. On structural and cohesion funds, as set out in 2003, it is our policy that wealthier countries should be responsible for their own regional policies. SCFs should be targeted on the poorest and, as a result of the deal that we secured in December 2005, 250 per cent. of structural and cohesion funding expenditure will go to new member states.
	The hon. Member for Altrincham and Sale, West (Mr. Brady) succeeded in emptying the Public Gallery, and I lost the will to live at some points in his speech. He said that the House was having the chance to debate the Bill only as the deal comes into force. That is not the case: the own-resources decision will not come into force until it is ratified by all member states, and I hope we will do so very shortly.

Kitty Ussher: He did not do that. The own-resources negotiations that took place after December 2005 implemented the deal. The hon. Gentleman should not believe everything that he reads in the newspapers.
	The hon. Member for Shrewsbury and Atcham (Daniel Kawczynski) asked why the UK should bail out countries including those in the Balkans, Ukraine and Georgia. Why should we give up the abatement, he asked, when public finances are stretched? I support enlargement—I am not sure whether Opposition parties do—and I am clear that the investment in new member states will be to the economic benefit of the UK. It will facilitate trade. In 2006, British exports to the countries that acceded in 2004 had risen by 36 per cent. in the first full year after accession. That means jobs and growth in the constituencies of all hon. Members.
	I listened with respect and interest, as always, to my hon. Friend the Member for Great Grimsby (Mr. Mitchell), although I did not agree with everything he said. He made the point that the CAP would increase in real terms, but that is not the case. A lot of erroneous numbers have been flying around this evening. As I have just said, in 2007 the CAP will be worth €55 billion, but it will reduce to €51 billion by 2013 in the prices of that year. I also do not agree with my hon. Friend that we would be better off out. With 55 per cent. of our total trade being with the EU—3 million jobs and inward investment—being in the EU gives us peace, prosperity and productivity growth.
	The hon. Member for Wokingham (Mr. Redwood)—

George Young: I welcome this opportunity to raise in the House my constituents' concern about proposals for a new flight path into Southampton and Bournemouth airports. NATS—National Air Traffic Services—has proposed additional controlled airspace from Newbury to Romsey, where aircraft may fly as low as 5,500 ft. Flights would be permitted between 5.30 in the evening and 9.30 in the morning. At this stage, the proposal would only affect inbound flights from next April, but if approved it could be extended to outgoing and therefore noisier flights. Indeed, the document says:
	"Bournemouth outbounds may also be positioned in this space."
	There seems to be no scope for limiting the number of movements using controlled airspace once it has been designated. The proposals have been opposed by Hampshire county council, Basingstoke and Deane district council, 18 parish councils, the council of partners of the north Wessex downs area of outstanding natural beauty, New Forest national park authority and the Campaign to Protect Rural England. I am grateful to Professor Johnnie Johnson and Alan Cox of Ashmansworth parish council and to councillors Horace Mitchell and Clive Sanders for their work in challenging these proposals.
	Despite those powerful objections—more than 500 were made—NATS has asked the Civil Aviation Authority to accept the proposals without amendment later this month. In a letter dated 2 October, the Minister, whom I welcome to the Dispatch Box, told me:
	"the change sponsor must submit a report to the CAA who will consider the proposal against regulatory requirements. As appropriate, this might include seeking the views of the Secretary of State for transport on environmental matters."
	I will show that those regulatory requirements have not been kept to. This evening's debate is apt because at the end of this month the CAA is due to take a decision, in which the Minister has a role, and today the Prime Minister sought to underline his Government's environmental credentials.
	There are two questions. First, was the consultation process fit for purpose? Secondly, has the case for change been made? First, on process, what NATS did might have been appropriate some 20 years ago, when concern about environmental issues was lower, there was less commitment to consulting and getting feedback, and parish councils were less engaged in the planning process. We lived then in a less participatory society. But today, when there is a proposal such as this, that process is no longer fit for purpose. MPs should be offered a briefing in the House, NATS should write directly to parish and town councils, the document should be intelligible and conform to recent guidelines, and NATS should be prepared to put on roadshows for those who want them.

Michael Ancram: I congratulate my right hon. Friend on securing this debate on a matter that affects large parts of his constituency and only a small part of mine, around the villages of Ham and Shalbourne, although the people there are very concerned. Does he agree that the real outrage about what is happening is that whereas a local planning authority can, as has happened in such cases, stop noise pollution in areas such as Ham and Shalbourne in relation to glider launches or motocross, when something of this sort is proposed there is no local control at all over what happens.

George Young: My right hon. and learned Friend is absolutely right. There is less protection for what may be a noisier development than there is for the developments that he has just described. Indeed, he has put his finger on a point that was in the Government's White Paper, "A better quality of life—strategy for sustainable development in the UK". That proposed more openness, transparency and accountability in the decision-making process. I am grateful to my right hon. and learned Friend.
	In May, a document landed on my desk, entitled "Terminal control south west airspace development", which I nearly binned because I do not regard North-West Hampshire as being in the south-west. It came with a letter dated 4 May, containing a list of organisations that the CAA had identified for consultation, which included MPs. It said:
	"Identified organisations are requested to cascade this information to related groups as deemed necessary."
	In other words, responsibility for consulting the parish councils was subcontracted by NATS to local MPs. Although local authorities also had that obligation, none of my parish councils were notified by them, and NATS made no attempt to see if the cascade they asked for had taken place. Indeed, one parish councillor e-mailed me on 8 August, two days before the consultation was formally ended, saying:
	"It was only by chance, nearly two weeks ago, that a local resident, on browsing the web, discovered that consultation was taking place. On investigation, it was clear that no Parish or Town Councils, local residents, or even Borough or County Councillors in the area north of Ashmansworth had heard of the proposals."
	The document flies in the face of the January 2002 Department for Transport guidance to the CAA, CAP 725, which states that the formal proposal must include
	"the options that have been considered, including the 'do nothing' option."
	But there was no assessment in the document of other options. That point was well made by Basingstoke and Deane borough council, which said:
	"It would also aid our consideration of these proposals if you will please provide details of the alternative options that were considered by NATS. The CAA Guidance states that this information should have formed part of the original Consultation document. It would also be helpful to have further detail regarding the pattern and nature of the delays (current and anticipated) that are intended to be alleviated or mitigated by the proposed extension".
	That was written on 10 August and it got no answer, so it wrote again, saying:
	"it is disappointing that we have received either no further information at all (as regards the pattern and nature of delays that are intended to be alleviated or mitigated by the Consultation) or inadequate information (as regards alternative options—your response dated 17 August 2007 lists five other options that were dismissed—but there is no reasoning as to why they were dismissed."
	On process, Hampshire county council was equally dismissive:
	"We would also recommend an improved consultation process which sets out the alternatives and their implications for the matters of concern set out above. Until that time, the County Council is registering an objection to the proposed airspace extension."
	There is no appeal against CAA decisions—unlike the other planning matters to which my right hon. and learned Friend referred—so it is particularly important that guidance be adhered to.
	The document was not only incomplete; it was rather difficult to follow. Hampshire county council, a beacon authority, said this about it:
	"The County Council and its local government partners are not resourced to determine specialist technical impacts in areas such as aircraft noise impacts, and this is a deficiency in the consultation documents. Equally the local community has been provided with little notice of the consultation and we believe that this is also a serious deficiency of the process."
	Basingstoke and Deane council agreed:
	"As mentioned in our 10 August letter, there is a very significant groundswell of local concern about NATS' failure to properly consult all Stakeholders and to produce a Consultation document written in plain English and readily understandable to those being consulted."
	There is a map on page 5 of the document, in the section on noise impact, which implies that the land between Minstead and East Woodhay is flat, whereas some communities are 800 ft up, and are therefore closer to the source of noise from aircraft flying overhead.
	The language used by NATS is at times impenetrable. Finally on the subject of process, the document is based on a rough estimate of the number of aircraft that might be directed down the new flight path, and on the current limited usage of Southampton and Bournemouth airports. However, both airports are scheduled for major expansion, and that fact is not reflected in the NATS assessment. Both airports currently have restricted night flying hours, which could easily change; in other words, flights might not stop in the new corridor at midnight.

George Young: I am glad that I gave my hon. Friend a slot, so that his intervention could land safely. It was well made, and underlines the point that the new flight path, once granted, could cope with a greater volume of traffic than the one on which the consultation paper was based.
	Those failures of process would be enough in themselves to invalidate the proposal for a new flight path. The Minister should make that clear tonight. However, when that is coupled with the second and substantive point—that the case for extending the air space has not been made—the case for rejection becomes unanswerable. The consultation paper could not have been clearer:
	"This airspace change aims to reduce the level of flight delays caused by an area of complex traffic interaction in the vicinity of the Compton VOR (a navigation beacon near Newbury)."
	It continued:
	"This situation causes the...airspace to be responsible for a high level of delay which in turn causes inconvenience ... inefficiency ... and ... a negative environmental impact."
	Later on we are told that the delay attributable to that is 15,000 minutes. The consultation paper says:
	"It is NATS' duty under the terms of its operating licence to address this situation and prevent excess delays being generated in the future."
	That is the case for change, but all attempts to get behind those figures were rebuffed. Ashmansworth parish council pounced on that weakness:
	"The Consultation document claimed that the primary reason for the proposed changes was to minimise delay. We have requested a breakdown of these delays (such as extent and timing) to judge their significance, but have received no reply on this."
	In a telephone conversation with NATS, one of my constituents was told that NATS was concerned with delays in flights going to Heathrow and Gatwick, as well as in those going to Southampton and Bournemouth. Fifteen thousand minutes sounds a lot; but it is the total delay for the whole year spread over every flight, which equates to about 10 seconds per flight. The proposals' impact on such delays might be even less, as the new flight path would operate for only part of the day.
	That raises other questions. Could such delays be reduced in other ways, by altering the timing or sequence of flights? NATS has made no mention of technological developments that might well impact on aircraft spacing, allowing a higher density without changing the flight paths. Then there are some weasel words in the document. The proposals will not reduce the delay; they will
	"reduce the potential for delay".
	We are not told by how much the delay would be reduced if proposals go ahead. On that shaky, unsubstantiated and unquantified edifice rests the whole case.
	By the time we got to the end of the consultation process, with the "Stakeholder Consultation Feedback", there was no mention of delays. In that document NATS shifted its ground and instead said:
	"This proposed airspace development is aimed at reducing complexity within the TCSW region."
	Ashmansworth parish council has pointed out that
	"the recent response from NATS makes no mention of delays and refers only to a desire to reduce complexity, which appears not to be a valid reason in CAP 725, without giving any figures for present complexity or how it compares with other regions of the UK."
	If the benefits are doubtful, the disbenefits are clear, and many are indeed conceded by NATS. The consultation document says:
	"The worst case B747 aircraft in the airspace produced maximum noise levels of between 62 and 69 decibels. B737-300s destined for Bournemouth Airport will use this airspace several times per day"
	and they produce
	"noise levels in the range 61-63 decibels. This...contrasts with what the Government have just said about Heathrow."
	This is what the Government said:
	"One interpretation of this is that we could abandon the existing restriction on noise levels at Heathrow Airport of 57 decibels and above. But I believe it is right that we retain this as a safeguard for those most affected by aircraft noise."
	There are also the downsides of noise, loss of tranquillity and visual intrusion, and the impact in villages quite high up on the north Wessex downs from civil aircraft where there are none at the moment. The proposed flight path covers highly environmentally sensitive areas—not only the north Wessex downs but the Test valley and the New Forest national park. Those who represent the north Wessex downs area of outstanding natural beauty has made it quite clear that:
	"The proposed changes would be detrimental to the special character and qualities of the area."
	What should happen now? I believe that the Minister should tell the CAA that he is not satisfied with this exercise, and that NATS should go back to the drawing board. There is no urgency about this, and no critical issue of safety. I do not see how the Minister can just tick this one through. Basingstoke and Deane council has said:
	"We would strongly recommend to NATS and to the Civil Aviation Authority that the Consultation be reopened—not only with a longer and more realistic time frame, but also with much more 'user-friendly' and understandable Consultation documents."
	Hampshire county council agrees:
	"In our view, the need for additional airspace has not been adequately proven since the benefits seem modest, and alternatives should be considered fully, including 'do nothing' and local stakeholders fully consulted on all the options. In considering these factors, NATS and the CAA should be mindful of the probable uptake of the available airspace by increased numbers of aircraft movements."
	I look to the Minister tonight to restore the credibility and integrity of the consultation process, for which he is ultimately accountable, and to say that this is not good enough.

Jim Fitzpatrick: I will express my view about the guidance in a few moments. At the moment, the best I can offer are the words that I have just used: I fully acknowledge the strong comments of the right hon. Gentleman and his right hon. and hon. Friends about the validity of the process. That is clearly on the record this evening.
	Following a large number of replies received near the end of the consultation period, NATS extended the consultation into the middle of September. That was done to ensure that all interested parties were given adequate opportunity to comment. NATS then undertook an analysis of all responses, which was forwarded to all who responded to the consultation and has been placed on the NATS website. That analysis, along with all consultation materials, was then submitted on 21 September by NATS to the CAA for regulatory review. The CAA will give regulatory approval for the airspace change only if all regulatory requirements are met. I understand that the CAA's decision is expected in January 2008. If approved, the proposed change would be implemented on 10 April 2008.
	I have stated already that it would be inappropriate for me to comment on the specifics of the proposal at this stage, but I would like to take this opportunity to restate NATS's aims for the development. NATS stated in its consultation materials that the proposed development aims to enhance the safety and efficiency of air traffic control procedures. I know that the right hon. Gentleman will agree that aviation safety must remain paramount. The UK air transport industry, and NATS in particular, has an excellent safety record, and accident rates have stayed low despite a rapid rise in traffic levels, although we must never rest on our laurels. That is why NATS constantly reviews its airspace management and makes proposals for airspace changes where it believes them necessary. In the case of terminal control south west, NATS believes its proposals will reduce air traffic control complexity, reduce the workload on individual controllers, reduce delay and bring efficiencies to all aircraft passing through the region.
	It is important that I emphasise that the NATS proposal is not associated with, and will not enable expansion of, services at Bournemouth or Southampton airports or at any other airport in the region. I recognise, as I have already made clear, that the right hon. Gentleman has concerns about the consultation process, but the CAA, as owner of the airspace change process, has advised that the consultation process has been conducted in accordance with its guidance.
	I think that it would be helpful to set out the process for delivering airspace change. The CAA must manage the airspace to meet the needs of all users, having regard to national security and economic and environmental factors, while maintaining a high standard of safety. The process for making changes to airspace is governed by the CAA's airspace change process, known as CAP725.
	Following review and consultation, a revised version was published in March 2007. The new guidance provides greater clarity on the roles and responsibilities of an airspace change sponsor such as NATS and of the independent regulator, the CAA. It also provides greater detail about the activities of a consultation exercise and the environmental assessment of any proposed change. A change sponsor is responsible for developing and consulting about a proposal and ensuring that it satisfies and/or enhances safety, improves capacity and mitigates, as far as is practicable, any environmental impacts in line with the Department's environmental guidance to the CAA.